Thursday, January 22, 2004

Antitrust News: Cato on Antitrust

Next Thursday the Cato Institute is holding a policy forum entitled "Antitrust in the High-Tech Marketplace: The Real Irrational Exuberance?" Here's Cato's description of the event:
The Department of Justice's Antitrust Division appears prepared to block Oracle's proposed $7.3 billion merger with PeopleSoft on the grounds of monopoly power in "business enterprise software." Similarly, a merger between EchoStar and DirecTV was halted. State attorneys general and even the European Union are increasingly scrutinizing mergers in the technology sector. Clearly, the Microsoft settlement did not end antitrust activism.

If Washington policymakers conclude that the technology marketplace is incapable of policing itself and that corporate breakup or aggressive market-definition policies qualify as sensible public policy, then what government intervention in the technology sector markets is off limits? Many economists object to such intervention in new business models—especially when the theories behind intervention are themselves highly questionable.

What does the future hold for technology companies and the competitive environment? Join us as our panelists analyze and debate the broader role of antitrust policy in the high-tech economy and a possible reform agenda.
The FTC has been particularly aggressive during the Bush administration in pursuing technology companies based on questionable market definitions. This is not surprising, given that the FTC's antitrust chief was, in the private sector, one of the lawyers behind the original Microsoft case. And if you think the White House considers aggressive antitrust enforcement to be in conflict with their call (reiterated in Tuesday's State of the Union address) for reduced business regulation, than you don't understand conservatives. In the minds of "free market" conservatives like FTC chairman Tim Muris, antitrust is the alternative to regulation, since it acts on a case-by-case basis without articulating any hard-and-fast principles.

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